With the government on one end and digital disruption on the other, Singapore Press Holdings needs a plan. Quick.

Singapore Press Holdings is a rich media company. Its market capitalization of S$4 billion ($2.9 billion) and yearly revenue of S$725 million for the media business must be the envy of many publishers globally. Its flagship newspaper, The Straits Times, has the breadth of world news coverage that many can only dream of, with 21 correspondents in 12 cities and a network of international contributors.

But many Singaporeans are highly critical of the publicly-listed company’s cash cow, the 172-year-old Straits Times, which is seen as a proxy of the government. Founding Prime Minister Lee Kuan Yew bought the paper’s loyalty by allowing it to make huge profits with hardly any competition. Press licensing laws and restrictive management shareholder rules on print media have essentially erected invisible barriers against rivals, allowing the newspaper to become a virtual monopoly. As though these were not enough, the chairman of SPH, Lee Boon Yang, is a former government minister, and the CEO, Ng Yat Chung, is a former military chief.

Under this protective umbrella, SPH is sleepwalking its way to a future darkened by digital disruption that has seen its profits fall for the past five years. For the financial year to August 2016, the company’s pre-tax profit fell 16.1 percent to $361 million. The media business alone saw pre-tax profit slumped even further—27.4 percent to $175.2 million. But there is hardly a bold strategy in place to check the slide.

Staff layoffs

Just two weeks ago, 130 SPH staff were retrenched and the Straits Times’ editor-in-chief talked about wanting to boost coverage of Asia. He said 30 percent of readers online now come from overseas and he wants to increase that figure. But the South China Morning Post in Hong Kong and the Nikkei Asian Review have already had a head start in that space.

The Straits Times has a digital-first strategy in place, with emphasis being placed on breaking news. It has 1.1 million Facebook followers and nearly one million Twitter users. But monetizing that strategy is difficult as Facebook and Google have already made inroads by seizing nearly 50 percent of the market. Another problem is the government’s alleged covert control of The Straits Times, a Singapore institution that Lee Kuan Yew once called the porcelain vase.

The simplest and clearest way forward for SPH is to dive deep into the digital era. But the publisher is caught in a classic dilemma:

Protecting and preserving its print-based media business will mean a slow erosion of profits; moving aggressively into digital will mean a faster scaling down of its print business.

Over the last 15 years, former CEO Alan Chan and former marketing chief Leslie Fong wanted to preserve print at all cost. Now that Ng Yat Chun, who came on board in September, is showing early signs of a corporate aggression not seen in the company for some time, a coherent business strategy might emerge. That will almost certainly not include a dramatic change in the way news is reported as the government will almost definitely veto that, because The Straits Times acts as a tool for its political success.

So what can the CEO and his management team do with a company whose revenue from its media business has declined for the fifth straight year in a row?

Cloud of uncertainty

Although he has said publicly that SPH would not close down any newspaper titles, the CEO might have no choice but to consider the future of some newspapers in the company’s stable.

The afternoon Chinese papers—Shin Min Daily News and Lian He Wan Bao—are so similar in content and market positioning that they are becoming a financial anachronism in a small country like Singapore. A merger of the two cannot be ruled out.

Then there is The New Paper, which is distributed for free. It moved out of the afternoon market into the morning space to put pressure on The Straits Times’ rival, Today. Now that the latter, whose pre-tax profit dropped from $10 million in 2014 to $3 million in 2016, surrendered the print market and went fully digital on October 1, The New Paper’s corporate mission is achieved and the plug is likely to be pulled on the 30-year-old paper.

The central kitchen concept that SPH had wanted to introduce for a long time also needs to be considered. It involves pooling resources across all the newspapers in the group, by getting staff to cover one event for the different publications. Though a cost-saving measure, it will make the newspapers in the SPH group look very similar and likely affect journalists’ morale.

But these measures are like biting at the fringes: they won’t be of much help in the long run. One big bang measure is a break-up of the company that will hive off the media business into a separate entity so that over a period of time, it won’t drag the company down.

That will free up management to look at aggressive diversification into areas that have nothing to do with media. SPH has already moved into property and old folk homes. It could join investment company Temasek and spread its wings outside Singapore by investing in non-media businesses overseas.

Whichever path it chooses, one reality is for sure: SPH cannot continue on as it did in the years from 1990 to 2010. Hemmed in by government control on one side and digital disruption on the other, SPH has to act quickly and decisively to determine its fate.

The new CEO, who spent four years at Temasek and got the green light from his masters to sell off a Singapore brand (Neptune Orient Lines) might just be the right person to act swiftly and boldly.